Govt Spending Allocation Increases Due To Subsidies

Jakarta, June 19 (Antara) - The government`s spending allocation increases Rp42.4 trillion to Rp1,196 trillion in the revised 2013 state budget due to a rise in fuel and electricity subsidies, the Finance Ministry said. "Fuel and electricity subsidies rise as a result of a change in basic macro economic assumptions," the acting chief of the ministry`s fiscal policy body, Bambang Brojonegoro, said here on Tuesday. He said spending on fuel subsidy is set at Rp199.8 trillion and electricity subsidy at Rp99.8 trillion, with the volume of subsidized fuels remaining at 48 million kiloliters. "Overall, the government`s spending on subsidies increases Rp30.9 trillion also because of a change in the parameter used as a basis for the calculation of energy subsidy, such as the volume of subsidized fuel consumption," he said. In addition, the government`s spending goes up Rp12.5 trillion as a result of the accelerated and expanded social security program designed to address the impact of the planned fuel price hike, he said. The direct cash handouts of Rp9.3 trillion and the infrastructure budget of Rp7.25 trillion to compensate the poor for the fuel price hike also raise the government`s spending this year, he said. He said the government`s spending also rise because of increasing budget allocations for the educational sector, bringing the total education budget to an estimated Rp245.3 trillion. Overall, the state spending in the revised 2013 state budget is set at Rp1,726.2 trillion, up Rp43.2 trillion from the budget ceiling of Rp1,683 trillion. He further said state revenues are projected to reach Rp1,502 trillion consisting of Rp1,148.4 trillion from tax receipts and Rp349.2 trillion from non-tax state revenues. The target of tax receipts falls Rp44.6 trillion from the target set in the 2013 state budget due to a change in macro economic assumptions and low realization of tax receipts from the revised 2012 state budget, he said. The budget deficit in 2013 is expected to reach Rp224.2 trillion or 2.38 percent of the gross domestic product compared to Rp153.3 trillion or 1.65 percent of the GDP last year.